Why pay thousands of dollars to a realtor?

When we bought our very first home, we had a realtor help us. She found us the property, helped us write up the offer, got us the forms to sign, scheduled the time with the title company and we showed up with a check! It was so simple. So of course, I wondered, why on earth did we just pay this woman thousands of dollars to do that?

I started looking online and sure enough, every form we needed was available on the internet, we could list or search for homes ourselves online, we could submit or accept our own offers, sign our own documents….it looked like a cake walk!

Listing our home FSBO style could put an extra $12,000 in our pocket!

That’s why when we went to sell that home to buy our next home, we decided to do it alone, without a realtor. We found a new home being built we loved; and we figured we had plenty of time to sell our current home before our new found home was finished. We did the math and realized that we could save $12,000 managing the transactions alone, without a realtor, so that’s what we did. We were so excited! And this wasn’t our first rodeo! So, we confidently listed the home For Sale By Owner.

But….Finding a buyer might be more difficult than we thought

First we went and bought ourselves a sign to put in the yard and went above and beyond by deciding to list the home for sale in a few newspapers and online venues. We found quickly that finding a buyer proved to be more difficult than we thought! We weren’t getting the eyes we needed on our property to sell, and we were running out of time, because we needed the money out of our current home, before we could close on the new home!

Reality Check: Our FSBO $12,000 math was SOOOOOO wrong!

We had a friend tell us that most home buyers work with a realtor in the buying process, so for us to find a buyer, we needed to change all of our newspaper ads to say that we would be willing to use a buying agent, in order to get in front of serious buyers. Since the 6% realtor fees (3% on seller’s side, 3% on buyer’s side) we were planning to save were split in half by bringing in a buyer’s agent to one of the two transactions, our planned $12k savings were now down to $6k. But, our original approach wasn’t bringing any buyers, and we were running out of time, so we changed our newspaper ads agreeing to work with a buyer that had an agent.

Reason: The unforeseen costs started adding up

Views of our home increased significantly and finally, we got an offer. They did NOT come with a realtor, but told us that they would NOT come with an agent if we would take that amount off the purchase of the home. Whatever!

We were planning on paying for it anyway, and we had to close this home or we were going to lose our new one. We had already lost our locked in interest rate on the new loan for not closing on time and interest rates were rising so we just had to get our current home sold! Plus, we were still going to end up positive by saving a little over $5,000 from not using a realtor after paying all the costs that the realtor normally paid for like signs, advertising posts etc. and $5,000 is a lot of money right?

The FSBO Journey Continues:

Legal paperwork - stressful, time sucking, and complicated YES, but doable.

Now we had a buyer so it was time to start the paperwork. We pulled up the checklist of documents online, printed them all off and started working with the buyer. The process was a little rough, but not too bad. The documents weren’t as “self-explanatory” as they appeared, but when all was said and done, we had a date set and we walked into the title company and got a check for our home!

The HARD Truth: We went from the idea of saving $12,000 to actually paying $12,000!

Done and done with $5,000 more in our pocket, or so we thought. We immediately turned around and locked in a new loan on our home and because we took so long selling, our new interest rate was .3% higher, we went from a 3.8% to a 4.1%. Now don’t get me wrong, this is still a great rate for our home, but the irony of the situation, is that our mortgage was an extra $34/month for 30 years. By the end of the mortgage, we would pay an extra $12,000 for our new home.

The saga isn’t over my friend: FSBO was already a struggle...and then it got worse

We had started regretting our decision to sell by owner a while ago, but now our only thunder left, our $5,000 savings was gone too. We would actually LOSE money through our financing rate. And then….it got worse.

The unthinkable occurred:

The beginning of 7 and ½ months of HELL

Within a couple of weeks of closing on our home, we got served with a lawsuit from the buyer. They were suing us for not following the full disclosure process of selling a home. We were confident we had signed the forms. But here was the real problem--it was our word against theirs, because we claimed they got a copy and they claimed they didn’t; and No third party was involved to say who was right, because we didn’t use a realtor.

After hiring an attorney and beginning to build our case we knew we were in trouble. We were only 1 week into the lawsuit when our first bill came from the attorney, $1,400. The pain and agony continued for the next 7 and a half months. The cost of fighting the lawsuit was paralyzing; but that wasn’t even the worst part! Because we had been sued, we were not allowed to change our financial situation, so we couldn’t close on our new home we were building.

If you’ve never been sued, let me explain. When you are sued, you can’t use or move your resources and assets because it’s illegal. You can be fined and even imprisoned because those things are all now on the table as possible elements that could be used to satisfy a judgement in the event that you lose the lawsuit.

We were stuck. It was absolute hell.

Litigation: The catalyst for emotional and financial trauma

When it all ended nearly eight months later, we had been financially forced to sell almost everything we had, meaning, we lost the home we were building, we had paid tens of thousands of dollars in legal fees. And the worst part of all, I was emotionally traumatized.

Every waking moment the situation plagued my thoughts. It was like carrying a thousand pound backpack through my life. My life, my hopes, my future, my family….everything was at risk. We could and were losing it all right in front of us and there was nothing we could do to make it stop and even fighting it wasn’t guaranteed because even though we didn’t do anything wrong, it was a he said/she said fight and those are a coin toss in the end!

Lesson Learned: NEVER AGAIN will I transact without a Realtor

What was the end result of our For Sale by Owner experience? What started out as a great idea that might just put an extra $12,000 in our pocket, in the end, cost us the following:

The home we were building, and envisioned raising our children in
The life we had envisioned for ourselves in that neighborhood
The lost savings we planned doing FSBO
The small amount we had put aside for retirement as a young family

In the end, outside of the time and home lost, we incurred nearly $50,000 in expenses, from using a buyer’s agent plus attorney fees. This series of events put so much strain on us financially and emotionally.

NEVER again would I allow myself to be so short-sighted. Never again would I put my family and my future at risk just to try and save a few dollars. The time savings, market knowledge, liability protection, and potential cost savings of using a realtor has become a no-brainer for our family.

AMY M DALLEY

"Our 1st time buying a home and we couldn’t have been more pleased. The whole process was a great experience for us and now we are home owners. Yay!"

Experience Recap: Lessons Learned

Since this experience, I have been involved in 14 more real estate transactions and learned some valuable lessons from this experience that have helped me along the way. We think we can just sell our home like selling anything else, but when you start dealing with items that cost hundreds of thousands of dollars, you aren’t in DIY land anymore.

First, LIABILITY: realtors are licensed and trained to handle the legal paperwork that goes along with the transaction, keeping YOU away from the liability and stress of doing it right. The possibility of doing it wrong is not worth the emotional cost, the time cost, and the potential liability.

Second, COST SAVINGS: deciding to transact as a FSBO creates time energy, effort, and risk that are NOT worth the potential money saved, which due to market timing variables could easily flip on you to be money lost. From losing the home to losing the interest rate to missing the peaks of the market, timing is everything.

Third, MARKET TIMING: being a seller without a realtor means being a seller without a very big market. Almost all buyers use realtors because it makes their life substantially easier. The market timing on the sell is critical and using a realtor expedites that timing.

Buying and selling a home is one of the largest, if not THE largest financial transaction you will ever make. Why would you do it without all the right support in place? Why would you not leverage professionals who ensure it is done right and that you get exactly what you want.

Keep reading my friend.

I learned my lesson to use a Realtor to manage house selling, but there was still so much more for me to learn about choosing the RIGHT Realtor.

We did our homework, got the right Realtor, bought a home, and it was smooth and easy!

We ended up moving to Florida after the dust settled, after our lawsuit FSBO saga, for my spouse to take a job there. He was finishing his contractor’s license and real estate was going to be a significant part of our life. As we purchased our home in Florida, we did our homework! We found the right realtor to buy our home, leading to a smooth and simple transaction. She found several homes for us, scheduled times based on our availability and we showed up. When we found the home we wanted, she wrote up the offer, helped us negotiate with the seller, handled all the documents making everything for us as easy as submitting electronic signatures and the next thing we knew, we were in our new home! IT WAS AWESOME!

How Hard Could it Be? Florida real estate was on fire, homes selling within 7 days with cash offers.

Two years later, life necessitated a move back to Utah and we needed to sell our Florida home. Our first item of business was going back to that same realtor. She was great. She did real estate full-time. She had bought and sold dozens of properties. She was very in tune with the area and very aware of all that was going on in the market. Because she worked with a network of other local realtors, she had good in-roads with buyers and she felt like she could sell our home quickly.

The Florida real estate market was on fire and homes were selling within 7 days of their listing and usually with cash offers at a great premium. After only two years of home ownership, we were looking at a potential of making $150,000 in the next 7 days and launching our life in Utah into a great new start.

Anyone could help us in this hot market: Pressure came to use a different realtor, a family member

The night before we listed our home with the experienced agent, we got a call from our sister-in-law. Times were tough at the moment for her brother who had just received his license to become a realtor. She begged us to use him instead of the realtor from our last transaction, because he desperately needed the money. She talked about how every home was moving so fast that our home would move by just getting it on the market, and as long as he handled all the paperwork (enter lawsuit PTSD...she was VERY aware of our previous experience), that we would be more than fine from a legal liability standpoint.

We felt obligated to help family out.

We felt trapped. On one hand we felt obligated to help family and we worried about how they would feel if we moved forward with our original agent. We had a professional realtor with a potential buyer for us and a chance to make great money from the sell of our home. The family realtor perspective was that it wouldn’t matter, the market was hot. Our perspective was that we might be taking a chance by using this family member who was a realtor. We felt pressure, we felt like it was turning our decision to sell our home from a financial decision into an emotional decision so in the end, we reluctantly agreed to let our family member list our “easy to sell in a hot market” home.

The Big Mistake: The next few weeks were a nightmare

The next few weeks were a nightmare. Our home would be his first listing, so no transaction experience. He couldn’t figure out how to get the home listed, he had to order signs because he didn’t have any, he had no negotiation experience, and no network of buyers and realtors to help the transaction run quickly and smoothly.

It was more than three weeks later before he was finally ready to put the home on the market to be listed. Two weeks later, life in Naples Florida stopped when we were all asked to evacuate our homes due to hurricane Wilma (immediately following the more famous hurricane Katrina from that same season). When we returned to our tattered neighborhood, a week later, the real estate bubble had burst. Not only had our home not sold, NOTHING was selling.

The nightmare got worse….we learned that not all Realtors are equally qualified

To make a long story short here, we would go on to move back to Utah and begin paying two mortgages, the one of our Utah home and our Florida home. This would continue on with two mortgages for over three years. At the point of facing bankruptcy, we worked with the bank to short sell the home; paying the penalty both financially and in our credit score which would haunt us for the next 5 years.

The Hardest but Best Lessons are in hindsight: The choice of which realtor to use would be the difference of $225,000!

That one simple decision to go with the wrong realtor was the difference between walking away with $150,000 in our pocket and instead losing $75,000 over a 3 year period of time. Why? Because we didn’t use an expert real estate agent, we felt obligated to help an inexperienced family member realtor.

KASSIDY GREGORY

"Personal experience with Wise Choice Real Estate is that their customer service and responsiveness is impeccable. They get the job done ✔ So glad I get to work with them!"

The Correct Lens: This is YOUR life, it is YOUR decision. Make the right one for YOU!

Over the last 20 years, I have been involved with buying and selling 14 different properties. After the first 2 nightmares, I learned two FIRM lessons.

Use an agent.
Use the RIGHT agent.

If you are buying and/or selling real estate, use a licensed professional realtor. You don’t pick the brand new guy who is doing it to grab a few extra dollars. You don’t pick a family member or neighbor out of obligation.

Selling and Buying a home is a BUSINESS transaction and it’s a big one. This is YOUR life, YOUR family, YOUR future and it shouldn’t be handled casually or with any kind of outside influence or pressure from friends or family.

You have ONE responsibility when you are buying or selling a home, do it the right way. Use licensed experts. Period. Don’t settle. Don’t cut corners. Don’t allow yourself to be influenced by a few extra dollars or friend/family pressure. This is an important transaction. DO IT RIGHT.

Selling Your Home should not be a pinterest fail….

Leave the DIY projects to the $20 yard sale cabinet, but when you are working with hundreds of THOUSANDS of YOUR dollars in Real Estate, leave it to the professionals.

There are a dozen things out there trying to make the real estate world look like it’s all about Do It Yourself, use the internet, a mobile app makes anything easy or anyone can do it so use your neighbor. But in reality, it’s not like an easy cake walk.

The right realtor will make it easy. They take away the stress, increase the speed of buying or selling a home so you capitalize on market timing. They often times save you money or get you more money due to their expertise and additional potential buyers and offers. And perhaps most importantly, they take over the liability and process so that you don’t spend any time or energy worrying. End result of using the right realtor: you just get to enjoy the ride, your home is sold, your dream home is under contract, and you’re safe. YOU’RE WELCOME.

The difference between the right realtor and the wrong realtor WILL cost you.

The difference in the RIGHT realtor and the WRONG one will cost you. It may cost you time. It might cost you money. It could cost you a relationship with someone you love. But it WILL cost you. This is NOT the category of life that you go discount, DIY shopping for. Do it right. Take it from me. It’s not worth it. You don’t need to learn for yourself what I spent 20 years and hundreds of thousands of dollars learning.

You find the RIGHT agent, and you let them do their job because in the grand scheme of things….if it’s the difference of a few thousand dollars….that’s the difference of a few bucks a month on a mortgage to get the home you want, without the stress and the time, and the liability.

And just to put the icing on the cake, 9 times out of 10, you’ll get more out of your home, you’ll pay less for your new home and you’ll enjoy the home buying process instead of feeling like your entire world is caving in on you.

TAMI MACKLEY

"So accommodating. Always going the extra mile. I loved working with them. :) highly recommended."

Thank you!

Learn from this REAL experience that will save you thousands on your home buying and selling process.

How to save money on selling your home...and its not what you think.

I’ve been buying and selling real estate for over 20 years. I’ve been involved with 14 different transactions. 12 of them were fantastic. 2 of them were nightmares. I wanted to share my experience with you so you don’t make the same mistakes I did.

How selling and buying is so simple